ADF Foods Ltd

Dear Shareholders,

Your Directors have pleasure in presenting the irty Fourth Annual Report together with the Audited Financial Statements for the Financial Year ended 31^st March, 2024.

A. Financial Results:

The performance of the Company for the Financial Year ended 31^st March, 2024 is summarized below:

(Rs. in Lakhs except per share data)

Previous year's figures have been re-grouped wherever necessary.

* The Shareholders of the Company, at the 33^rd Annual General Meeting held on 9^th August, 2023, approved the sub-division of 1 (one) equity share of face value Rs. 10/- each (fully paid-up) into 5 (Five) equity share of face value Rs. 2/- each. The basic and diluted Earnings Per Share (EPS) numbers for the Financial Year ended 31^st March, 2023 have been restated to give effect of the share split.

Financial Performance

The Standalone total income for the Financial Year ended 31^st March, 2024 stood at Rs. 42,503.01 Lakhs as against the corresponding figures of previous Financial Year which stood at Rs. 36,344.79 Lakhs representing growth of 17%. The Consolidated total income for the Financial Year ended 31^st March, 2024 stood at Rs. 53,139.40 Lakhs as against the corresponding figures of previous Financial Year which stood at Rs. 46,149.53 Lakhs representing growth of 15%.

The Standalone Profit Before Tax for the Financial Year ended 31^st March, 2024 stood at Rs. 10,572.65 Lakhs as against the corresponding figures of previous Financial Year which stood at Rs. 8,076.06 Lakhs representing a remarkable growth of 31%. The Consolidated Profit Before Tax for the Financial Year ended 31^st March, 2024 stood at Rs. 9,807.13 Lakhs as against the corresponding figures of previous Financial Year which stood at Rs. 7,546.24 Lakhs representing a remarkable growth of 30%.

Brand Performance:

The Company's flagship brand ‘Ashoka' continued to grow at double digits. It crossed Rs. 250 Crore in revenue in FY 2023-24 and growing at CAGR 29% over the last three years. During the year, the Company launched 37 new products across various categories including frozen desserts, snacks, Indian fiat breads, gravies, chutneys, canned sweets, Indo-Chinese sauces under the Ashoka brand. Some of the SKUs received listing nods with a large discounter and a supermarket chain in UK.

Simultaneously, the Company has initiated the expansion exercise of the ‘Truly Indian' brand meant for the global mainstream population. The Company has added a range of frozen items and expanded its existing cooking sauces, pastes and ready-to-eat curries under the Truly Indian banner to further satisfy the needs of the foreign consumer and penetrate more supermarket chains. The brand was initially launched in Germany and has seen great success over the last couple of years. The Company hopes to recreate this success with its launch in the US market which is expected to roll out in the coming financial year.

During the year, the Company's domestic business has grown as planned. The products under ‘ADF Soul' brand are available pan India on the Company's own E-commerce platform https://soul-foods.in. The products are also available on other leading E-commerce/ Q-commerce marketplaces i.e. Amazon, Flipkart, Swiggy Instamart and BigBasket. The Company has done category extension under chutneys and pickles in olive oil and traditional pickles. The Company is planning to launch many more exciting products in the near future, in the better-for-you foods space. ADF Soul aspires to be a Rs. 100 crore brand in the next three to four years. The Company has committed an additional investment of Rs. 13 crore in order to support the growth plan of ADF Soul.

Operational Updates:

Debottlenecking and Brownfield investment undertaken has helped the Company to increase capacity at Nadiad and Nasik and it has hence, surrendered its temporary lease facility at Surat which will save lease overheads and bring operational efficiency. The Company has initiated setting up of a new cold storage with an investment outlay of Rs. 15 crore at the Company's manufacturing plant at Nadiad which will result in better operational efficiency.

The Company has broken ground in its Surat greenfield project and has committed Rs. 75 crore for Phase 1 expansion. is expansion will cater to both new as well as existing lines for the frozen foods.

During the year, the Company created a large freezer capacity in New Jersey warehouse, which will help the Company to do faster fulfilment of frozen category products in the US market.

The Company made some key hires across the organization strengthening functional teams of marketing, sales and operations.

C. Material changes and commitments affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report:

There are no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the Financial Year 2023-24 to which the Financial Statements relate and the date of this Report.

D. Share Capital:

During the year, the Board of Directors of the Company at its meeting held on 6^th May, 2023 considered and approved the proposal for sub-division of 1 (one) equity share of the Company having face value of Rs. 10/- each (fully paid-up) into 5 (five) equity shares of the Company having face value of Rs. 2/- each and consequential amendment in the Capital Clause of the Memorandum of Association of the Company, subject to the approval of the Shareholders of the Company. The said proposal was subsequently approved by the Shareholders of the Company at the 33^rd Annual General Meeting held on 9^th August, 2023. The Record Date for the sub-division was set as 11^th September, 2023 and consequently, the face value of the equity shares of the Company was reduced to Rs. 2/- each from Rs. 10/- each.

Accordingly, your Company's Authorised Share Capital as on the date of this Report is Rs. 25,00,00,000/- (Rupees Twenty Five Crore Only) divided into 12,50,00,000 (Twelve Crore Fifty Lakh) equity shares of Rs. 2/- each.

The Paid-up Share Capital as on the date of this Report is Rs. 21,97,27,190/- (Rupees Twenty One Crore Ninety Seven Lakh Twenty Seven Thousand One Hundred and Ninety Only) divided into 10,98,63,595 (Ten Crore Ninety Eight Lakh Sixty Three Thousand Five Hundred and Ninety Five) equity shares of Rs. 2/- each.

Your Company has not issued any Shares with differential voting rights or by way of rights issue or sweat equity shares or shares under ESOP. Further, it has not provided any money to its employees for purchase of its own shares hence your Company has nothing to report in respect of Rule 4(4), Rule 8, Rule 12(9) and Rule 16 of the Companies (Share Capital & Debentures) Rules, 2014.

E. Dividend:

During the year, the Company in order to celebrate three decades of listing of the Company's shares on the recognized stock exchanges paid to the Shareholders, a Special (Interim) Dividend of Rs. 4.00/- per share (i.e. 200%) on equity share of face value of Rs. 2/- each in the month of November, 2023, involving a cash outflow of Rs. 43.94 crore.

Further, based on the performance of the Company, the Board of Directors of your Company, at their meeting held on 9^th May, 2024, recommended a Final Dividend at Rs. 1.20/- per share (i.e. 60%) on equity shares of face value of Rs. 2/- each for the Financial Year ended 31^st March, 2024, subject to the approval of the Shareholders in the ensuing Annual General Meeting (‘AGM') to be held on 1^st August, 2024. The Board has recommended the dividend based on the parameters laid down in the Dividend Distribution Policy and dividend will be paid out of the profits of the year.

The final dividend on equity shares, if approved by the Members, would involve a cash outflow of Rs. 13.18 crore. The total dividend for Financial Year 2023-24 amounts to Rs. 5.20/- per share (i.e. 260%) and would involve a total cash outflow of Rs. 57.12 crore, resulting in a dividend payout of 71.73% of the standalone net profit of the Company.

The Final Dividend, if approved by the Shareholders at the ensuing AGM will be paid within 30 (thirty) days from the date of declaration of dividend, to those Shareholders whose names appear in the Register of Members / List of Beneficial Owners of the Company as on Friday, 26^th July, 2024 ("Record Date"), received from the Depositories i.e. National Securities Depository Limited and Central Depository Services (India) Limited.

The Register of Members and Share Transfer Books of the Company will remain closed from 27^th July, 2024 to 1^st August, 2024 (both days inclusive) for the purpose of payment of Final Dividend for the Financial Year ended 31^st March, 2024.

In view of the changes made under the Income Tax Act, 1961, by the Finance Act, 2020, dividends paid or distributed by the Company shall be taxable in the hands of the Shareholders. The Company shall, accordingly, make the payment of the Final Dividend after deduction of tax at source, wherever applicable.

Pursuant to Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), the top 1000 listed entities based on market capitalization, calculated as on 31^st March of every financial year are required to formulate a Dividend Distribution Policy which shall be disclosed on the website of the listed entity and a web-link shall also be provided in their Annual Reports. Accordingly, the Dividend Distribution Policy of the Company can be accessed using the following link: https://adf-foods.com/wp-content/uploads/2024/06/Dividend-Distribution-Policy.pdf

F. Transfer to Reserves:

During the year, your Company has not transferred any amount to General Reserves. Further, the Company does not propose to transfer any amount to General Reserve on declaration of the Final Dividend.

G. Subsidiary Companies:

As on 31^st March, 2024, your Company has four Subsidiaries viz. ADF Foods (UK) Limited, Power Brands (Foods) Private Limited, ADF Foods (India) Limited and Telluric Foods (India) Limited and four step-down Subsidiaries viz. Telluric Foods Limited, ADF Holdings (USA) Limited, ADF Foods (USA) Limited and Vibrant Foods New Jersey LLC. Power Brands (Foods) Private Limited is undergoing Voluntary Liquidation vide Special Resolution passed by the Members on 5^th November, 2012. Hence, the annual financial statements as on 31^st March, 2024 of the said Subsidiary are not required to be prepared.

During the year, the Board of Directors reviewed the affairs of the Subsidiaries in accordance with Section 129(3) of the Companies Act, 2013 ("the Act"). The Company has prepared consolidated financial statements of the Company which forms part of this Annual Report. The salient features of the financial statements of the Subsidiaries are set out in the prescribed form AOC-1 which is attached to the financial statements. The statement also provides the details of performance and financial position of the Company's Subsidiaries. There has been no material change in the nature of the business of the Company's Subsidiaries. There are no associates or joint venture companies within the meaning of Section 2(6) of the Act.

The financial statements of each of the Subsidiaries of the Company, viz. ADF Foods (India) Limited, Telluric Foods (India) Limited, Telluric Foods Limited, ADF Foods (UK) Limited and ADF Holdings (USA) Limited (consolidated with its subsidiaries ADF Foods (USA) Limited & Vibrant Foods New Jersey LLC) as on 31^st March, 2024 may be accessed on the Company's website at www.adf-foods. com.

Pursuant to provision of Regulation 16(1)(c) of the Listing Regulations, the Company has formulated a ‘Policy on determining Material Subsidiaries'. The said Policy can be accessed using the following link: https://adf-foods.com/wp-content/uploads/2024/06/Policy-for-Determining-Material-Subsidiary.pdf. The Board of Directors of the Company approved transfer of the Company's entire investment in Equity shares held in its wholly-owned subsidiary, ADF Foods (India) Limited to its step-down wholly-owned subsidiary, Telluric Foods Limited.

Further, the Board of Directors of the Company has in-principally approved the merger between the Company's subsidiaries i.e. ADF Foods (India) Limited [Transferor Company] and Telluric Foods Limited [Transferee Company] to achieve business synergies.

H. Board of Directors and Committees: o Directors

As on 31^st March, 2024, the Company has eight Directors with an optimum combination of Executive and Non-Executive Directors including one Women Director. The Board comprises of two Executive Directors and six Non-Executive Directors, out of which four are Independent Directors.

Re-appointment of Mr. Bimal R. akkar as the ‘Chairman, Managing Director & CEO' of the Company:

On 30^th January, 2023, the Board of Directors of the Company based on the recommendation of Audit Committee and Nomination and Remuneration Committee approved the re-appointment of Mr. Bimal R. Thakkar (DIN: 00087404) as the ‘Chairman, Managing Director & CEO' of the Company for a period of 5 (five) years w.e.f. 1^st October, 2023. The same was approved by the Shareholders of the Company through Postal Ballot on 11^th March, 2023. Also, pursuant to Schedule V of the Act, re-appointment of Mr. Bimal R. Thakkar as the Managing Director of the Company required the approval of the Central Government as he is a Non Resident Individual. The Central Government granted its approval under Section 196 read with Schedule V of the Act for the said re-appointment of Mr. Bimal R. Thakkar.

Appointment of Non-Executive Independent Director and Whole Time Director of the Company:

Based on the recommendation of the Nomination and Remuneration Committee vide Circular Resolution passed on 18^th September, 2023, the Board of Directors of your Company, vide Circular Resolution dated 19^th September, 2023, have approved the appointment of Mr. Pheroze K. Mistry (DIN: 00344590), as an Additional Director in the category of Non-Executive Independent Director of your Company for a period of 5 (five) years w.e.f. 19^th September, 2023 subject to the approval of the Shareholders of the Company.

Further, pursuant to the recommendation of the Nomination and Remuneration Committee vide Resolution passed in its meeting held on 31^st October, 2023, the Board of Directors of your Company, vide Resolution dated 31^st October, 2023, have approved the appointment of Mr. Arjuun Guuha (DIN: 10366057), as an Additional Director in the category of Whole Time Director of your Company for a period of 5 (five) years w.e.f. 31^st October, 2023 subject to the approval of the Shareholders of the Company. The aforesaid appointments were subsequently approved by the Shareholders of the Company through Postal Ballot by remote E-voting facility on 7^th December, 2023.

During the Financial Year 2023-24, the following changes took place in the Board composition:

Pursuant to the provisions of Section 152 of the Act and the Articles of Association of the Company, Mr. Viren Merchant (DIN: 00033464) Non-Executive, Non-Independent Director of your Company, retires by rotation at the ensuing AGM and being eligible, Mr. Viren Merchant offers himself for re-appointment. Your Board has recommended his re-appointment.

Further, the Board of Directors, at its meeting held on 9^th May, 2024, approved the appointment of Mr. M. M. Srivastava, IAS, (Retd.), (DIN: 02190050) as an Additional Director in the category of Non-Executive Independent Director on the Board of the Company for a term of 5 (five) years, with effect from 9^th May, 2024.

The said appointments are subject to approval of the Shareholders at the ensuing AGM.

o Relationship between Directors Inter-se

The details of inter-se relationship between Directors are given in the Corporate Governance Report.

o Meetings of Board of Directors

Four meetings of the Board of Directors of the Company were held during the year. The detail of the Board Meetings are provided in the Report on Corporate Governance of the Company, which forms part of this Annual Report.

o Committees of the Board

The Company has duly constituted the Committees of the Board as required under the Act read with applicable Rules made thereunder and the Listing Regulations, as amended from time to time.

The Board of Directors of the Company has formed an Audit Committee which consists of Mr. Chandir G. Gidwani, Non-Executive Independent Director, as the Chairman, Mr. Ravinder Kumar Jain, Non-Executive Independent Director, Mr. Viren A. Merchant, Non-Executive Non-Independent Director and Ms. Deepa Misra Harris, Non-Executive Independent Director as Members of the Audit Committee.

All the recommendations of the Audit Committee were accepted by the Board during the Financial Year.

The other Committees of the Board are:

i) Nomination and Remuneration Committee

ii) Shareholders' Grievance/ Stakeholders' Relationship Committee

iii) Corporate Social Responsibility Committee

iv) Risk Management Committee

The details with respect to the constitution/ reconstitution, powers, roles, terms of reference, meetings held and attendance of the Members at such meetings of the relevant Committees and such other related details are provided in the Report on Corporate Governance of the Company, which forms part of this Annual Report.

o Directors' Responsibility Statement

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(5) of the Act:

a) that in the preparation of the annual financial statements for the Financial Year ended 31^st March, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) that such accounting policies as mentioned in Note 2 of the Notes to the Standalone Financial Statements and in Note 2 of the Notes to the Consolidated Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company and of the Profit and Loss of the Company for the Financial Year ended 31^st March, 2024;

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) that the annual financial statements have been prepared on a going concern basis;

e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

f) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

o Independent Directors' Declaration

The Independent Directors have submitted a declaration that each of them meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 25 of the Listing Regulations, as amended from time to time.

o Independence of the Board

The Board comprises of optimal number of Independent Directors. Based on the confirmation/disclosures received from the Directors and on evaluation of the relationships disclosed, the following Non-Executive Directors are Independent in terms of Regulation 16(1)(b) and Regulation 25 of the Listing Regulations and Section 149(6) of the Act:

1. Mr. Chandir G. Gidwani (DIN: 00011916);

2. Mr. Ravinder Kumar Jain (DIN: 00652148);

3. Ms. Deepa Misra Harris (DIN: 00064912);

4. Mr. Pheroze K. Mistry (DIN: 00344590); and

5. Mr. M. M. Srivastava IAS, (Retd.), (DIN: 02190050) [Appointed w.e.f. 9^th May, 2024, subject to approval of the Shareholders at the ensuing AGM].

All the abovenamed Directors have registered themselves with the Independent Directors Databank. They are exempted from the requirements of online proficiency self-assessment test conducted by ‘Indian Institute of Corporate Affairs'.

The Board is of the opinion that the Independent Directors of the Company, including those appointed during the year, possess the requisite qualifications, experience and expertise and hold the high standards of integrity.

o Meeting of Independent Directors

A meeting of the Independent Directors was held on 6^th March, 2024 in order to take into consideration the performance of the Board as a whole, the Chairman and the Non-Independent Directors and timeliness of flow of information between the Company Management and the Board that would be necessary for the Board to effectively and reasonably perform its duties, was reviewed in the said meeting. All the Independent Directors were present in the meeting.

o Performance Evaluation of the Board

Pursuant to the provisions of the Act and Regulation 17 of the Listing Regulations, the Board has carried out an annual performance evaluation of its own performance, of Chairman, its Committees and the Directors individually and also fulfillment by Independent Directors of criteria of independence as per the Listing Regulations and their independence from the Management of the Company. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

o Familiarization Programme for Independent Directors

The Independent Directors of the Company are eminent personalities having wide experience in the field of business, finance and marketing. Their presence on the Board has been advantageous and fruitful in taking business decisions. Independent Directors are appointed as per the Governance guidelines of the Company, with management expertise and wide range of experience. The Directors appointed by the Board are given induction and orientation with respect to the Company's vision, strategic direction, core values, including ethics, corporate governance practices, financial matters and business operations by having one-to-one meeting with the Managing Director and through a Corporate Presentation. The new Board Members are also acquainted to access the necessary documents/brochures, Annual Reports and Policies available on the Company's website at www.adf-foods.com to enable them to familiarize with the Company's procedures and practices. Periodic presentations are made by the Senior Management, Statutory and Internal Auditors at the Board/Committee meetings on business and performance updates of the Company, working capital management, fund flows, business risks and its mitigation strategy, effectiveness of Internal Financial Controls, Subsidiary Companies information, updates on major litigations, impact of regulatory changes on strategy, etc. Updates on relevant statutory changes encompassing important laws are regularly intimated to the Independent Directors.

Familiarization Programme of the Company as specified under Regulation 46 of the Listing Regulations is displayed on the Company's website at www.adf-foods.com and is available under the web-link: https://adf-foods.com/wp-content/uploads/2024/05/Familiarization-Programme-2023-24.pdf

o Policy of Directors' Appointment and Remuneration

In accordance with the provisions of Section 134(3)(e) read with Section 178(3) of the Act and the Listing Regulations, the Company has formulated a Policy on Directors' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters, which is covered in the Corporate Governance Report which forms part of this Annual Report.

I. Cash Flow Statement:

The Cash Flow Statement pursuant to Regulation 34(2) of the Listing Regulations is annexed to this Annual Report.

J. Consolidated Accounts:

The Consolidated Accounts of the Company are prepared in compliance with Regulation 34(2) of the Listing Regulations and in accordance with the Companies (Indian Accounting Standards) Rules, 2015 (IND AS) as prescribed under Section 133 of the Act. The Consolidated Accounts of the Company and its Subsidiaries are annexed to this Annual Report.

K. Governance: o Corporate Governance Report & Management Discussion and Analysis Report

In compliance with the provision of Regulation 34(3) and Schedule V of the Listing Regulations, a separate report on Corporate Governance along with Auditors' certificate on its compliance has been provided separately which forms part of this Annual Report.

Report on Management Discussion and Analysis is provided in separate section which forms part of this Annual Report.

o Vigil Mechanism/Whistle Blower Policy

The Company has adopted a Vigil Mechanism/‘Whistle Blower Policy' pursuant to Section 177 of the Act read with Regulation 22 of the Listing Regulations with an objective to conduct its affairs in a fair and transparent manner and by adopting the highest standards of professionalism, honesty, integrity and ethical behavior.

With the adoption of this Policy, the Company has put in place a mechanism wherein the Employees are free to report to the Management any actual or possible violation of the Principles or any other unlawful or unethical or improper practice or act, or activity of the Company including leakage of Unpublished Price Sensitive Information. Under the Whistle Blower Policy, the confidentiality of those reporting violation(s) is protected and they are not subject to any discriminatory practices. No personnel has been denied access to the Management and the Audit Committee. The mechanism is reviewed by the Audit Committee of the Company in accordance with the Listing Regulations. The Company did not receive any such complaints during the year, hence no complaints were pending as on 31^st March, 2024.

Whistle Blower Policy of the Company is displayed on the Company's website at www.adf-foods.com and is available under the web link: https://adf-foods.com/wp-content/uploads/2024/06/Whistle-Blower-Policy.pdf

o Nomination and Remuneration Policy

The Nomination and Remuneration Policy is attached as Annexure I to the Board's Report forming part of this Annual Report and is also available on the website of the Company at www.adf-foods.com.

o Risk Management Framework

The Company has adopted Business Risk Management System (BRMS) for mitigating various risks associated and identified across all levels within the organization. is model is based on ISO 31000. BRMS enables the management to review the business risks on periodical basis and to bring the high risk areas to the immediate attention of the Board. In the opinion of the Board, there are no business risks that may threaten the existence of the Company.

o Internal Financial Controls

The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. Review of the internal financial controls environment of the Company was undertaken during the year under review which covered verification of entity level controls, process level control and IT controls, review of key business processes and analysis of risk control matrices, etc. During the period under review, effectiveness of internal financial controls was evaluated. Reasonable Financial Controls are operative for all the business activities of the Company and no material weakness in the design or operation of any control was observed.

o Other Policies under the Listing Regulations

In accordance with the provisions of Regulation 30 of the Listing Regulations, the Company has framed a Policy for determination of Materiality for disclosure of events or information. The same has been hosted on the website of the Company at the link: https:// adf-foods.com/wp-content/uploads/2024/06/Policy-Determination-of-Material-Events.pdf The details of the other policies of the Company can be obtained using the following web-links:

o Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company is committed to creating and maintaining an atmosphere in which employees can work together without fear of sexual harassment, exploitation or intimidation. The Company has a policy on Prevention of Sexual Harassment of Women at Workplace pursuant to the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Further, the Board has constituted Internal Complaints Committees (‘ICCs') pursuant to the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder. ICCs is responsible for redressal of complaints related to sexual harassment at the workplace in accordance with procedures, regulations and guidelines provided in the Policy.

The Prevention of Sexual Harassment Policy of the Company is displayed on the Company's website at www.adf-foods.com and is available under the web-link: https://adf-foods.com/wp-content/uploads/2024/06/Sexual-Harrasement-Policy.pdf During the year, the Company received one complaint of sexual harassment and the same has been resolved by taking appropriate actions by the Internal Complaints Committee of the Company.

L. Particulars of Employees: o Key Managerial Personnel (KMP)

Mr. Bimal R. akkar, Chairman, Managing Director & CEO, Mr. Arjuun Guuha, Whole Time Director, Mr. Shardul Doshi, Chief Financial Officer and Ms. Shalaka Ovalekar, Company Secretary & Compliance Officer are the KMPs of the Company as on date of this Report.

Mr. Devang Gandhi, holding the position of Chief Operating Officer, resigned from the Company w.e.f. 31^st January, 2024. Mr. Arjuun Guuha was appointed in his place as the Whole Time Director w.e.f. 31^st October, 2023 to carry out the functions in the capacity of Director – Operations.

o Employees

There were no employees drawing remuneration exceeding the monetary ceiling of Rs. 1.02 Crores per annum or Rs. 8.50 Lakhs per month during the Financial Year 2023-24, if employed for a part of the year, as prescribed under the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 except Mr. Bimal R. akkar, Chairman, Managing Director & CEO whose remuneration is commission based and drawn from the Company's Subsidiary(ies). Mr. Shardul Doshi, CFO, Mr. Arjuun Guuha, Whole Time Director and Mr. Balark Banerjea, President – India Domestic Business.

Further, Mr. Devang Gandhi, COO of the Company was also drawing remuneration exceeding Rs. 8.50 Lakhs per month who resigned w.e.f. 31^st January, 2024.

The information required under Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given at Annexure II that forms part of this Report.

o Human Resource and Employee Relations

The Company has always perceived its Manpower as its biggest strength. The emphasis was on grooming in-house talent enabling them to take higher responsibilities. The Employee relations continue to be cordial at all the divisions of the Company. Your Directors place on record their deep appreciation for exemplary contribution of the employees at all levels. Their dedicated efforts and enthusiasm have been integral to your Company's steady performance.

M. Particulars of loans, guarantees or investments under Section 186 of the Act:

The Loans, Guarantees and Investments covered under Section 186 of the Act form part of the Notes to the Financial Statements provided in this Annual Report.

N. Particulars of contracts or arrangements with related parties:

All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other Designated Persons, Subsidiary Companies and other related parties which may have a potential conflict with the interest of the Company at large. Related Party Transactions are placed before the Audit Committee and also the Board for approval wherever such approvals are applicable. Prior Omnibus approval of the Audit Committee is obtained on yearly basis for the transactions which are of a foreseen and repetitive nature. A statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval/ noting on a quarterly basis. The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website.

Further, as per the Listing Regulations, if any related party transaction exceeds _ 1,000 crore or 10% of the annual consolidated turnover as per the last audited financial statement whichever is lower, would be considered as material and require Members approval. In this regard, during the year under review, the Company had taken necessary Members approval. However, there were no material transactions of the Company with any of its related parties as per the Act. erefore, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 is not applicable to the Company for the Financial Year 2023-24 and, hence, the same is not required to be provided.

O. Public Deposits:

Your Company has not accepted any deposit within the meaning of Section 73 and 76 of the Act and the Rules made thereunder during the Financial Year 2023-24.

P. Transfer of amounts to Investor Education and Protection Fund:

Pursuant to the provisions of Section 124 and Section 125(5) of the Act, the Company is required to transfer the dividends which remained unpaid or unclaimed for a period of 7 years to the Investor Education and Protection Fund ("IEPF") established by the Central Government. No dividend was declared by the Company for the Financial Year 2015-16, and hence during the Financial Year 2023-24, no dividend was due to be transferred to IEPF account.

Transfer of Equity Shares to the Demat account of IEPF Authority

Pursuant to the provision of Section 124(6) of the Act read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘Rules'), as amended from time to time, it is mandatory for the Company to transfer all the shares in the name of IEPF in respect of which dividend has not been claimed for seven consecutive years or more.

The Company did not declare dividend for the year 2015-16 and hence during the Financial Year 2023-24 the Company was not required to transfer any shares to IEPF Authority.

Q. Corporate Social Responsibility Initiatives:

The Company has a Corporate Social Responsibility (CSR) Policy and set up CSR Committee and the same is currently comprising of four Members viz. Mr. Viren Merchant, Non-Executive Non-Independent Director, Mr. Bimal R. akkar, Chairman, Managing Director and CEO, Mr. Jay M. Mehta, Non-Executive Non-Independent Director and Ms. Deepa Misra Harris, Non-Executive Independent Director.

During the Financial Year 2023-24, the Company was required to spend an amount of Rs. 1,22,07,520.04 on the CSR activities pursuant to Section 135 of the Act after adjusting the excess CSR amount of Rs. 18,380.27 that was spent in the Financial Year 2022-23.

During the year, the Company had spent an amount of Rs. 1,23,35,432/- towards various meaningful CSR activities in the areas such as sponsoring education for underprivileged/disabled students, medical expenses for needy people, food expenses of residential care center for physically challenged youth and children undertaking cancer treatment, financial aid to underprivileged people, women empowerment etc.

The CSR Policy of the Company and the relevant report as per the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been enclosed as Annexure III to this Report.

R. Business Responsibility & Sustainability Report:

A Business Responsibility & Sustainability Report as per Regulation 34 of the Listing Regulations, detailing the various initiatives taken by the Company on the environmental, social and governance front is provided in separate section which forms part of this Annual Report.

S. Annual Return:

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on 31^st March, 2024 is available on the Company's website on: https://adf-foods.com/wp-content/uploads/2024/06/Annual-Return-2023-24.pdf

T. Auditors and their Report: o Statutory Auditors

During the year, M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants, Mumbai (Firm Registration No. 104607W/W100166) were the Statutory Auditors of the Company. At the Twenty-Ninth Annual General Meeting ("AGM") held on 25^th September, 2019, the Members had approved their re-appointment as Statutory Auditors of the Company for a period of 5 (five) years from the conclusion of the said AGM till the conclusion of the ensuing 34^th AGM to be held for the Financial Year 2023-24.

Further, the term of M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants, as the Statutory Auditors of the Company, will expire on the conclusion of the ensuing 34^th AGM to be held on 1^st August, 2024. In terms of the applicable provisions of the Act, they will not be eligible for re-appointment as Statutory Auditors of the Company, since they have completed two terms of 5 consecutive years each.

Accordingly, an item for appointment of M/s. M S K A & Associates, Chartered Accountants (Firm Registration No. 105047W), as the Statutory Auditors of the Company is being placed at the ensuing AGM for approval of the Members. Information about the proposed appointment of statutory auditor is given in the Notice of AGM, which forms part of this Annual Report. The Board recommend their appointment to the Members.

The Board Members and the Audit Committee at their Meetings held on 9^th May, 2024 had reviewed the performance and effectiveness of the audit process of Statutory Auditors including their independence. The Board Members and the Audit Committee expressed their satisfaction towards the same.

The Auditors' Report for the Financial Year 2023-24, does not contain any qualification, reservation or adverse remarks and therefore there are no further explanations to be provided for in this Report.

o Secretarial Audit

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed M/s. Keyul M. Dedhia & Associates, Company Secretary in Practice (C.P. No. 8618), to undertake the Secretarial Audit of the Company for the Financial Year 2023-24. The Secretarial Audit Report is annexed herewith as Annexure IV.

There are no material observation or instances of non-compliance.

M/s. Keyul M. Dedhia & Associates have been re-appointed as the Secretarial Auditor of the Company for the Financial Year 2024-25.

o Internal Audit

The Company had appointed M/s. RMJ & Associates LLP, Chartered Accountants, Mumbai (Firm Registraion No. W100281) to conduct Internal Audit of the Company for the Financial Year 2023-24.

M/s. RMJ & Associates LLP, have been re-appointed as the Internal Auditors of the Company for the Financial Year 2024-25. The Audit Committee of the Board of Directors, Statutory Auditors and the Management are periodically appraised of the Internal Audit findings and corrective actions taken.

o Cost Records and Audit

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Act are not applicable for the business activities carried out by the Company.

o Details with respect to fraud reported by the Auditors

During the year, the Auditors have not reported any matter under Section 143(12) of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.

U. Significant and material orders passed by the regulators:

During the year, the Company had received an order of adjudication of penalty of Rs. 4,00,000/- (Rupees Four Lakh Only), from the Registrar of Companies (ROC) - Gujarat and Adjudicating Officer, under Section 454(3) of the Act read with Rule 3 of the Companies (Adjudication of Penalties) Rules, 2014 for violation of provisions of Section 196 read with clause (e) of Part I of Schedule V of the Act with respect to the previous appointment of Mr. Bimal R. akkar as the Chairman, Managing Director & CEO of the Company effective from 1^st October, 2018 and ending on 30^th September, 2023. The said order dated 20^th February, 2024 was received by the Company on 28^th February, 2024. As per the said order, a penalty under Section 450 of the Act is imposed on the Company and Officers in Default for violation of Section 196 read with Schedule V of the Act as follows:

1) ADF Foods Limited – Rs. 2,00,000.

2) For four Officers in Default – Rs. 50,000 each.

The Company has preferred an appeal with the Regional Director, Ahmedabad, against the said order within the prescribed timeline to quash and set aside the said order and also to bring stay on effecting the said Order till hearing and final disposal of the present appeal. The decision of the Regional Director is awaited.

The Company does not foresee any material impact on financial or operational activities due to the said imposition of penalty. Also, the said order shall not have any impact on the going concern status of the Company and its future operations.

Apart from the above mentioned order, no significant and material orders were passed by the Indian Regulators or Courts or Tribunals that would impact the going concern status of the Company and its future operations.

V. Listing of Shares:

The Company's equity shares are listed on BSE Limited and the National Stock Exchange of India Limited. The Company has duly paid the necessary listing fees with the concerned Stock Exchange(s) for the Financial Year 2023-24.

W. Technology and Quality:

Your Company is committed to deliver highest quality of products by continuous improvement in terms of product quality and achieving customer satisfaction and delight.

Your Company has already obtained various Quality and Product Safety certifications such as the internationally recognized ISO 22000 certificate and GFSI-BRCGS (British Retail Consortium Brand Reputation Compliance Global Standard) Food Safety certification for its plants located at Nadiad, Gujarat and Nasik, Maharashtra.

X. Energy, Technology Absorption and Foreign Exchange:

Information required under Section 134(3)(m) of the Act read with the Rule 8 of the Companies (Accounts) Rules, 2014 is appended hereto and forms part of this Report as Annexure V.

Y. Code of conduct for Directors and Senior Management:

The Directors and Members of Senior Management have afirmed compliance with the Code of Conduct for Directors and Senior Management. A declaration to this effect has been signed by Mr. Bimal R. akkar, Chairman, Managing Director & CEO and forms part of this Annual Report.

Z. The details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year alongwith their status as at the end of the financial year:

No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year is not applicable.

AA. The details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the banks or financial institutions along with the reasons thereof:

The requirement to disclose the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

BB. Disclosure Requirements:

The various policies and codes adopted by the Company are stated in detail in the Corporate Governance Report of the Company, which forms part of this Annual Report.

The Company during the financial year complied with the applicable provisions of the Secretarial Standards issued by the Institute of the Companies Secretaries of India and approved by the Central Government under Section 118 (10) of the Act.

CC. Acknowledgements:

Your Directors wish to express their sincere appreciation of the excellent support and co-operation extended by the Company's shareholders, customers, bankers, suppliers and all other stakeholders.

For and on Behalf of the Board of Directors

Regd. Office:

83/86, G.I.D.C. Industrial Estate, Nadiad - 387 001, Gujarat

Tel.: 0268-2551381/2, Fax: 0268-2565068;

E-mail: info@adf-foods.com; Website: www.adf-foods.com

CIN: L15400GJ1990PLC014265